19th straight clean audit strengthens NMC’s case for funding, rebuilding

Northern Marianas College’s 19th consecutive clean audit gives the CNMI’s lone community college something increasingly important as it seeks federal, local, and philanthropic funding to rebuild its campus and support its students: a nearly two-decade record showing outside funders that it can be trusted with their money.

NMC received an unmodified, or clean, audit opinion for fiscal year 2025, extending its streak to 19 years while recording zero audit findings for the latest fiscal year. The college also retained its designation as a low-risk auditee under federal requirements.

Interim NMC president Frankie M. Eliptico said the significance goes well beyond having clean books.

“Nineteen clean audits represents trust in our financial management,” Eliptico told Marianas Press during an interview with NMC chief financial officer David Attao and chief accountant Wilfredo Abu at NMC’s As Lito Campus last Aug. 25. “So basically, auditors have found no material weakness in the way that NMC manages the funds that it has entrusted.”

He said that record matters because NMC receives money from several sources, including federal grants, appropriations, and philanthropic donations.

“The auditors have, by indicating that we have an unmodified audit opinion, have indicated that the college manages its funds well, and it maintains accurate records year after year for 19 straight years,” Eliptico said.

According to the college, an unmodified opinion means its financial statements fairly present its financial position in accordance with generally accepted accounting principles in the United States. The absence of findings means auditors identified no material weaknesses, significant deficiencies, or instances of noncompliance involving NMC’s internal controls over financial reporting.

The clean audit takes on added importance as NMC continues efforts to rebuild a campus battered by multiple typhoons and relies heavily on outside funding.

Eliptico said the college’s audit history is among the information funding agencies examine when NMC seeks grants.

“One of the first things we get asked off the bat when we are applying for a grant is the status of our audit,” he said.

Eliptico said NMC had zero findings in its FY 2025 audit and has been able to resolve previous findings.

“Those, again, items signal to federal grantors that they can trust us with the funds that are given to us,” he said. “And those funds include not just grants for new buildings, but also funds that are given to students for their financial aid awards.”

He said that includes Pell Grants and funding for various college programs. A clean and current audit record does not guarantee NMC will receive a grant, he said, but can remove potential obstacles when the college competes for funding.

“It really just opens additional doors of funding opportunities for us,” Eliptico said.

That becomes particularly important as NMC moves ahead with plans for a new campus. Eliptico said much of the money needed for rebuilding comes from external sources, including federal agencies, which routinely ask for the college’s latest audit.

“We adhere to these strong internal controls to strong financial management to show the public that the college and its employees can be held accountable for the funds that it is entrusted with,” he said.

Attao said the college has not had an audit finding in three years and has resolved nearly all findings from previous years.

He said when a finding occurs, the college develops a plan to correct the problem and establish policies or procedures intended to prevent it from recurring.

“We do take responsibility as a team, as a whole, as a college, to resolve those matters,” Attao said.

Abu attributed the college’s record in part to compliance with internal controls and accounting standards.

“I enforce really a good compliance with our internal control policies and procedures in order to make sure that we are preventing fraud and detect, you know, misstatement of the financial reports,” Abu said.

He said NMC also works to comply with generally accepted accounting principles and applicable governmental accounting standards.

The college maintained its audit record despite leadership changes, natural disasters, the COVID-19 pandemic, and a transition from legacy accounting and student-data systems to a cloud-based enterprise system.

Eliptico said NMC’s internal controls are designed so they do not depend on a particular president, CFO, chief accountant, or administration.

“The internal controls and other mechanisms we have outlive any one person,” he said.

Among those controls are checks and balances that prevent a single individual from handling an entire transaction from beginning to end. Attao said NMC also keeps federal funds separate from local funds and appropriations to prevent commingling.

Abu said another important part of NMC’s record is its ability to complete its audits on time.

“We were able to comply with auditing of our books year after year on a timely basis,” he said. “We are not delayed.”

NMC said its low-risk status carries practical benefits, including reducing administrative burdens associated with applying for and administering grants and demonstrating greater confidence in the college among federal agencies.

The college said it is among the few CNMI entities that hold both a clean audit and low-risk designation while also submitting audits on time.

For Eliptico, maintaining the streak means treating financial accountability as a year-round responsibility rather than something the college prepares for shortly before auditors arrive.

“We don't treat the audit as only a few months of the year,” he said. “We treat it all year round as audit season or as CFO mentioned, it's embedded in our culture, our organizational culture that we adhere to strong financial management.”

He said that record tells federal grantors, philanthropic organizations, and other funding agencies that NMC can properly manage the money entrusted to it.

The record could also strengthen NMC’s case before CNMI lawmakers. Eliptico said the college recently appeared before the House Ways and Means Committee to justify its budget request.

“The fact that we have a clean audit for 19 straight years strengthens our request because it shows to our stakeholders, including policymakers, that they can trust us,” he said, adding that appropriations can be accounted for “for every single dollar that's given to Northern Mariners College.”